The Nobel Prize in Economics will be announced on Monday, with sentiment leaning toward proponents of free and global trade, including Jagdish Bhagwati, as a likely winner.
Other topics, including why natural rates of unemployment are driven by economic necessity and even "Ricardian equivalence," which dictates that governments cannot increase demand by deficit spending are also theories that could be honored with the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel. Like the traditional Nobel science prizes _ medicine, physics and chemistry _ there is no precise formula for predicting the decision by the Royal Swedish Academy of Sciences.
Previous winners of the prize, given out since 1969, ranged from how the control of information affects markets to welfare economics used to explain the economic mechanisms that underly famine and poverty.
That wide swath of difference is unlikely to change this year, said Hubert Fromlet, the chief economist with Swedbank in the Swedish capital.
Perennial contender Bhagwati, a noted proponent of free trade and critic of opponents of globalization, is listed by Thomson Scientific as a likely winner. The Indian-born Columbia University economics professor was an external adviser to the World Trade Organization and served as a special policy adviser on globalization to the United Nations.
Fromlet said this year's award has seen some 150 to 200 names and topics bandied about as likely winners, including Gene Grossman of Princeton University and Elhanan Helpman of Harvard for their work on how trade is affected by general purpose technologies, or GPTs. That's where significant and fast leaps in innovation can affect a complete economy on a national or even global scale, changing the way trade and business is accomplished, such as the Internet and even the steam engine.
Other likely winners include Paul Romer of Stanford University, touted for his efforts in developing the New Growth Theory, which has provided new foundations for businesses and governments trying to create wealth.
Last year's winners were Robert J. Aumann, a citizen of Israel and the United States, and American Thomas C. Schelling, for their work in game-theory analysis.
The economics prize, worth 10 million kronor (euro1.1 million; US$1.4 million), is the only one of the awards not established in the will left by Swedish industrialist Alfred Nobel 111 years ago. The medicine, physics, chemistry, literature and peace prizes were first awarded in 1901, while the economics prize was set up separately by the Swedish central bank in 1968.
The economics prize is the fourth of six to be announced. The winner of the Nobel Prize in literature is to be announced Thursday, October 12, followed by the Nobel Peace Prize in Oslo, Norway, the following day.
Last week, the Nobel medicine prize went to Andrew Z. Fire and Craig C. Mello for discovering a powerful way to turn off the effect of specific genes. John C. Mather and George F. Smoot won the physics prize Tuesday for work that helped cement the big-bang theory of how the universe was created.
American Roger D. Kornberg won the prize in chemistry for his studies of how cells take information from genes to produce proteins, a process that could provide insight into defeating cancer and advancing stem cell research.
The Nobel prizes are presented on December 10, the anniversary of the death of their founder. The peace prize is awarded in Oslo, Norway, and the other Nobel prizes are presented in Stockholm.